Question
Decker Products manufactures standard and deluxe wooden swing sets. Selected data related to each product is as follows: Sales Prices: Standard $900 Deluxe $2,000 Direct
Decker Products manufactures standard and deluxe wooden swing sets. Selected data related to each product is as follows:
Sales Prices: Standard $900 Deluxe $2,000
Direct materials cost per unit: Standard 100 Deluxe 500
Direct labor cost per unit: Standard 300 Deluxe 700
Variable overhead cost per unit: Standard 50 Delux 100
Machine hours per unit: Standard 4 hours Delux 8 hours
Most of the manufacturing process for the sets is done on machines.
There is a maximum of 10,000 machine hours available each year. Refer to the Decker Products information above. If demand were strong by both sets and the company could sell an unlimited number of either style, how many of which kind(s) of wooden swing set(s) should be produced in order to mazimize profits?
a. | 2,500 standard setts | |
b. | 1,250 deluxe sets | |
c. | 833 standard sets and 833 deluxe sets | |
d. | 1,500 standard sets and 1,250 deluxe sets |
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